My First BRRRR! With Pictures!

My First BRRRR! With Pictures!

Investor · Anchorage, AK · Member since 2016 · 222 posts · 294 votes

I have completed my first BRRRR successfully! It is a 2Br 1 Ba small SFR (Pictures Below). It took me about 4 months to complete this Rehab in from start to finish. I Hired out Most of the Big items : New roof, driveway, furnace, siding, and fence. I performed ALL other work by myself with occasional help from Family members: Complete Electrical Revamp (New wires, Panel, Meter Base, outlets, etc), New Pex plumbing, Shed revamp, Landscaping, Windows, flooring..and basically everything else. I did all of this while working full-time at my day job, and going to this house everyday after work for 2-3 hours and working on Saturdays and Sundays. I have learned so much and I now know that I never want to do most of the work again. I only want to perform the work that I am excellent and efficient at, and that is basically the electrical stuff only LOL. I'm good at everything...just not efficient. I am so glad I was conservative with my numbers at first, because There were a bunch of things that I did not know I would have to fix/replace. But since I was super conservative, it worked out great.

I funded this deal using a HELOC from my parents house, because I made a deal with my father that I would completely renovate his kitchen for free labor on the entire thing, if he would setup the HELOC for me to use. He was so happy with his kitchen that he set up the HELOC with no more questions asked. I completed his kitchen a year ago, and this HELOC had been setup for me to use for over a year now.

I found this deal because I heard an elderly lady passed away down my street, and heard that her relatives (the executor of the estate) were staying there. So I went over to the house and knocked on the door and spoke with them. I asked if they would sell to me and told them my intentions for the house. We really got along great and they decided to sell me the house. This house hadn't had any maintenance on it since the 80's, and was in complete disrepair (the before pics don't do justice). On top of that, the lady that had passed away was a chain smoker, and the place stunk sooo bad.

Here are my numbers:

Purchase and closing costs: $102,000

Rehab and Holding Costs: $53,000

Refinancing costs: $8000

ARV: $230,000

Total Equity in the end: $67,000 +/-

I have not found a renter yet, as it is winter and I just finished 2 days ago :) But even on my low end rent estimate I should cash-flow $100/mo+, and my high end $400/mo. Below are the before and after pictures. I used the same view as the before pictures, I did remove a wall between the kitchen and LR, FYI.

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Investor · Roseville, CA · Member since 2016 · 893 posts · 1k+ votes
7y

Great job @Cam Jimmy!  I think my favorite part of your story is the creative solution to raise your capital with your father.  Way to think out of the box to get to your goal!  

Just curious, how did you go about negotiating the purchase price?  

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  • Investor · Ypsilanti, MI · Member since 2016 · 7 posts · 0 votes
    7y

    Great job!

    Is the kitchen split up? The oven area looks like it is across the room on its own.

    The old sink and toilet looked re-usable.

  • Flipper/Rehabber · Newport News, VA · Member since 2016 · 128 posts · 54 votes
    7y
    @Cam Jimmy excellent ! Love the story and worked performed. Keep it up!!
  • Royal Oak, MI · Member since 2017 · 9 posts · 5 votes
    7y

    @Cam Jimmy Thanks for sharing. I am looking to do my first BRRRR very soon too.

    Based on the numbers, I would agree with the others that this is a better flip. I also like you idea of holding for a year to avoid the short term tax. If you can get through a year without refinancing, that could save on the refi fees but you will have to consider the holding costs. You might miss on some opportunities holding it, unless you have other funding methods. Good luck!

  • Investor · Anchorage, AK · Member since 2016 · 222 posts · 294 votes
    7y

    @Kent Lau Well my strategy at first was to get all of the exterior items done first, before it snows. Then after that, You must do all of your in-wall and in-attic items like plumbing, bathroom, electrical, etc. Then close up walls, putty, prime, paint. Then finish out electric and plumbing. Then you can start doing finish items like cabinets, flooring, hanging doors, trim, then paint trim, and touch up items. Sorry for the quick explaination.. but you basically have to think what needs to be done as a whole, and you can easily figure out what needs done first. Example: no point in painting the place before you do plumbing, becasue youre going to have to rip out walls, etc.

    @Bill Goodland Absolutely yes to you last question. Brand new "in-stock" lowes Cabinets are super cheap and add a TON of value and beauty. Especially when you add nice knobs and handles. I was amazed how cheap the "in-stock" cabinets were. Also if you spend more than $1,500 at lowes, talk to the prodesk, and have them submit your items through QSP ( Home depot version is called the "bid room"). QSP allows you to get the best price on all the items... usuall %5-%15 off of everything. Only as long as your order is $1,500 or more though. Also Costco is THE best place to find nice good priced LED light fixtures...and other items too!

    @Leanne J. I definitely considered all options. I've personally lived in 3 houses exactly like this in the same neighborhood. only 750 Sq. Ft. Once you put your Kitchen table in the middle of the room, this is the best it gets in these houses. You should see some of the crazy dumb layouts people do in these houses lol. This is the best, trust me.

    @Skyler Mckinney lol I must have fooled you guys... The only "high-end" finish.. would be the backsplash and kitchen sink. Everything else is builder grade, low-mid priced appliances, or I got on sale for super cheap :) I guess, That is another thing I learned... How to make things look good for cheap.

    @Jeremy Mangen At the start of the project I was looking around for the correct lenders.. and found the one I wanted about a month into the project.. Just waited until 3 month mark to get paperwork started.

    @Blake Elder 20-year loan

    @Kevin Christensen It takes about a month. Most places want you to have it for 6 months, but keep searching smaller banks/credit unions. you may find one that only requires 3 months :)

    @Max Miller Yes the kitchen is split, with the idea of the kitchen table to sit right in the middle. Old toilet was disgusting, anyways even if it wasn't, if youre doing a rehab a new toilet is only $100-$200. Definetly get a new toilet. The old bathroom vanity and sink was sold on craigslist for $80!

    @Caleb Coats too late I already refi :( but, now my HELOC is open again to use :) and I get to keep the rental, or flip it later, or whatever. It's a good problem to have.

  • Specialist · San Diego, CA · Member since 2018 · 16 posts · 5 votes
    7y
    @Cam Jimmy Well done mate!! Beautiful home, great deal!
  • Rental Property Investor · Vancouver, British Columbia · Member since 2018 · 53 posts · 18 votes
    7y

    What a makeover. It looks really good!

  • Flipper/Rehabber · Medford, OR · Member since 2018 · 6 posts · 3 votes
    7y

    Great job.  Really like what you did, how you decided to think outside of the box.  Very encouraging. Thank you especially for the before and after pictures

  • Royal Oak, MI · Member since 2017 · 9 posts · 5 votes
    7y

    @Cam Jimmy - That's right! it is a good problem to have. Most importantly you took action. Thanks again for sharing and congratulations!

  • David AcostaPro Member
    Wilmington, NC · Member since 2014 · 208 posts · 144 votes
    7y

    Awesome job, @Cam Jimmy.  Looks great!

  • Investor · Anchorage, AK · Member since 2016 · 222 posts · 294 votes
    7y

    @Joshuam R. Since I already Messaged someone about this, I'll just copy and paste it here.

    As far as reno costs.. I can really only ESTIMATE the costs of the work that I did, because I bought so many different things throughout the entire process. for example, I bought the toilet in the first month because lowes had an excellent sale on toilets that week. Anyways I can however give you exact numbers for the contracted items. keep in mind this was only a 750 sq ft house too.

    Contracted Items:

    Roof: $4,100

    Steel high quality Siding from ABC seamless (3 sides only): $6000

    New paved driveway with retaining wall: $4,400

    New furnace and some duct work: $4300

    New gypcrete poured on entire Slab to level floor: $2,300

    Gutters were included in the siding job

    Tape, Putty and Patch work on the entire interior: $2000

    New blown-in insulation and baffles: $1,100

    My work (materials Only (give or take)):

    Windows $2500

    Laminate flooring from Costco: $1200

    floor Tiles on sale at Lowes: only $50!

    The entire kitchen, Cabinets, appliances, counters, etc..: $6,500-$7,000

    Entire electrical Revamp : $4000 (This would have been 10k+ if i hadnt done the work)

    New pex Plumbing - $1000

    Entire Bathroom - $3000

    Trim and doors - $ 1500

    There were also so many misc items that I cannot remember. Also about $5000 in holding costs. Please Give or take some of these numbers... I do not have my actual spreadsheet where I am.. so if the numbers dont add up exactly.. this is why. I may even double dipped on some of these items.. like flooring in the bathroom/kitchen. I hope this helps! good luck!

  • Specialist · Lynchburg, VA · Member since 2017 · 162 posts · 90 votes
    7y

    THIS PLACE IS GORGEOUS! THAT'S AMAZING ! CONGRATS ! @Cam Jimmy

  • NJ · Member since 2018 · 23 posts · 7 votes
    7y

    Very nice job! I just got a multi-family property under contract and am also looking to BRRRR it, hopefully it comes out as successful as yours!

  • Member since 2018 · 2 posts · 1 vote
    7y

    Great Job! excellent remodeling!

  • Lender · New Haven, CT · Member since 2018 · 1 post · 1 vote
    7y
    @Cam Jimmy awesome job bro, if no one told you yet, I will ! I'm proud of you man, and I'm always happy to see people succeed.
  • Investor · Anchorage, AK · Member since 2016 · 222 posts · 294 votes
    7y

    I just wanted to say thank you to everyone that has commented. I never knew I'd get so many people saying encouraging words. I feel like a celebrity lol :). I wanted to point out that this was all possible for me because of THIS website. Bigger Pockets is the sole reason I was able to do this BRRRR and my first duplex. I love the podcasts, both the REI Podcast, and the Money Show. I love all of the books. And I love these forums. Thank you @Joshua D. @Brandon Turner @Mindy Jensen @Scott Trench @David Greene And all of the other employees...You guys are awesome!

  • Investor · New York, NY · Member since 2014 · 153 posts · 126 votes
    7y

    Fantastic Job!! You did a great job, keep it going & best of luck on your journey! @Cam Jimmy

  • Geoff ChanPro Member
    Rental Property Investor · Sacramento, CA · Member since 2017 · 23 posts · 13 votes
    7y

    @Cam Jimmy Congratulations and thanks for sharing your great story; how the deal was found, negotiated, funded, and what you did with it!

    The rehab looks fantastic!  Also thanks for sharing your rehab details.  The new driveway makes a huge difference for curb appeal.

    How did you go about finding the contractors and negotiating scope of work and determining if the price was fair and reasonable?  One of the biggest challenges i find is the contractor's proposals don't like to breakdown labor and material, which makes it difficult for me to cost engineer/budget future work. Any thoughts you can share is most appreciated.

  • San Diego, CA · Member since 2018 · 22 posts · 6 votes
    7y

    I am in the process of my first BRRRR. It has been rented out for 6 months now. How long tipically do you need to show rent to refi?

  • Investor · Anchorage, AK · Member since 2016 · 222 posts · 294 votes
    7y

    @Geoff Chan Well Most of the contractors (The good ones at least) Post signs in the front yards of houses they worked on. So some of the bids I received from contractors were from yard signs...like the siding company I used. Also word of mouth, and past experiences. Ask around, people will tell you they either love or hate a company, and for what reason. One good thing Ive learned over the years is how much the labor is worth to me. I've shingled shed roofs and stuff, and I absolutely hate it.. Since ive done the work and know what it entails... I had no problem paying the $4100 for the company to do the roof. That work is back and knee breaking...and its dangerous. I hope this helps.

    @Sean Harrison Most banks typically want you to just own it for 6 months.. and if your debt to income ratio doesn't qualify.. they would need to see a signed rental lease. doesn't matter how long your lease has been in affect. You should start shopping around now since you have already met most banks minimums.

  • new york city · Member since 2017 · 40 posts · 23 votes
    7y

    great job on your first BRRRR, it must feel really good to accomplish something new

  • Real Estate Agent · Anchorage, AK · Member since 2017 · 294 posts · 182 votes
    7y

    @Cam Jimmy well done! And way to get an AK BRRRR on the blog!

  • Investor · Anchorage, AK · Member since 2016 · 222 posts · 294 votes
    7y

    @Jamie Rose Thanks!

  • Priya ThomasPro Member
    Investor · Cincinnati, OH · Member since 2017 · 135 posts · 61 votes
    7y

    what is the rent?

  • Tacoma, WA · Member since 2016 · 8 posts · 1 vote
    7y

    Great job! Looks good and the numbers worked out great.

    Thanks for sharing.

  • Rental Property Investor · Brooklyn, NY · Member since 2018 · 3 posts · 0 votes
    7y

    Wow, awesome, congrats!!! Thanks for sharing it the experience.

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